Doing business with the federal government can be a lucrative proposition. However, in accordance with US federal regulations, there are certain conditions that must be met. One of the biggest ones: an Affirmative Action Program (AAP). An AAP includes those policies, practices, and procedures that the contractor implements to ensure that all qualified applicants and employees are receiving an equal opportunity for recruitment, selection, advancement, and every other term and privilege associated with employment.
Many California companies use the calendar year (January to December) as the plan dates for their Affirmative Action Plans (AAPs). Speak with your legal counsel about updating your plan for 2016.
Who Needs an APP?
If it is your company’s goal to work with the government, having an APP in place is a wise idea. A few of the fastest growing government industries include military, automotive, education, energy, IT, and healthcare.
Under federal law, government contractors and subcontractors with 50 or more employees who have entered into at least one contract of $50,000 or more with the federal government must prepare and maintain a written affirmative action program within 120 days from the commencement of the contract. Again, this plan must be updated annually.
Based on the size of the contract, government contractors are required to developed affirmative action programs in compliance with three separate federal laws (Executive Order 11246, the Rehabilitation Act of 1974, and the Vietnam Era Veterans Readjustment Assistance Act). All three of these laws prohibit employment discrimination and require contractors to exercise good faith efforts so that certain protected classes have the opportunity to be hired and advance in employment.
Additionally, as of 2014, a contractor may be audited in connection with its good faith efforts to recruit protected veterans and disabled individuals. This process includes identifying and listing all recruiting efforts made by the company to recruit veterans and disabled individuals during the year and evaluating the effectiveness of each effort.
What Happens if the Contractor Doesn’t Comply?
Failure to comply with the non-discrimination or affirmative action provisions in a government contract is considered a violation of the contract. The Department of Labor’s Office of Federal Contract Compliance Program (OFCCP), the agency that oversees these laws, has the authority to conduct compliance evaluations, which may consist of an off-site review of records and/or an on-site review of records and interviews. In every OFCCP audit, the Compliance Officer will request to review the current year AAP — again stressing the importance that all AAPs are properly updated each year.
For more information on APPs and your government contract, contact experienced business lawyer Drew E. Pomerance today.
